The Government is pushing ahead with its commitment to end public subsidies for onshore wind farms, by closing the Renewables Obligation across Great Britain from 1 April 2016. An amendments to the Energy Bill they have set out the grace period criteria open to onshore wind companies as part of the planned cuts to the subsidy regime, providing further certainty for investors.
RenewableUK’s Deputy Chief Executive, Maf Smith, said: “This announcement means that wind farm companies can now go ahead and fully invest in local wind farm projects. It’s good to see that Government has acknowledged the financial uncertainty caused by these changes and the additional time offered will help rebuild investor certainty.
It’s important that industry works with Government and Parliament to ensure these amendments are incorporated and the Energy Bill gets on the statute books as soon as possible. It is only then that developers can deliver the level of new capacity the Government wants to see by 2020.
While today’s announcement will help us reach targets in the short-term, we need to make sure that onshore wind remains part of a competitive energy market. Onshore wind is one of the cheapest forms of electricity and it makes long-term sense for consumers. We will work with Government to ensure the industry can help build the new energy infrastructure the UK desperately needs”.
Michael Rieley, Senior Policy Manager for Scottish Renewables, said: “While we need to assess the precise impact of the announcement, it is clear that government has sought to address some unintended consequences of the decision to close the RO, for example, giving more time to projects unable to access finance because of the uncertainty created by the closure.
“However, many of our members will be bitterly disappointed that ministers are not going to allow projects which have submitted planning applications to be given a grace period.”
He added: “It is still our position that the UK Government’s rationale for removing financial support for onshore wind was unjustified. It is a course of actions that will, according to their own assessments, save just 30p on annual consumer energy bills and increase the UK’s carbon emissions by 63 million tonnes.
Renewables remain key to meeting our long term and legally binding climate change targets, and it is vital that the Government sets out a long term plan to support the growth of the industry as we approach the climate change talks in Paris in December.”
Scottish Energy Minister Fergus Ewing said: “The UK Government’s decision to close the Renewables Obligation early has a disproportionate effect on Scotland and the Scottish Government has made repeated calls to extend the grace period for all projects currently in the planning system. Although the UK Government has not consented to this, today’s decision will provide some clarity to projects and investors who meet their criteria.”
“I am hosting a stakeholders event next week in London which will be an opportunity to hear first-hand the full impact of these decisions on the industry.”